Why is the sugar industry not favorable in India
Answers
Answer:
India has become largest producer of sugar cane/sugar producing 280 MnT of cane and 16.5 MnT of sugar in 1995-96, making it the largest producer of sugar in the world, representing about 20% of cane sugar production. India also produces another 10 MnT of traditional sweeteners (gur 9 MnT, khandsari 1 MnT). India also has a large consumer base, thus makes it quite vulnerable to international sugar market, in the event of surplus or deficit situation. At the sametime it has good potential and prospects.
Sugar production commenced in 1920's but it got industry status in late 20's/early 30's when India had 29 sugar mills producing just 100,000 tons of sugar. The industry, facing competition from imported sugar, sought tariff protection. Sugar production picked up under the Sugar Industry Protection Act passed in 1932 and country became self sufficient in 1935. Also cane pricing act was enforced to provide good cane price to farmer. This was followed by land reforms putting ceiling on land holdings to protect small farmers, formation of cane grower cooperatives and setting up of sugar mills jointly with farmers called as cooperative mills on ownership and sharing basis. Today this sector produces 60% of country's production.
Explanation:
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Answer:
High cost of sugarcane, inefficient technology, uneconomic process of production and heavy excise duty result in high cost of manufacturing. Most of the sugar mills in India are of small size with a capacity of 1,000 to 1,500 tonnes per day thus fail to take advantage of economies of scale.
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